The Tata group and its Japanese partner, NTT DCOMO, are finalising modalities under which the latter will stay invested in the joint telecom venture, Tata Teleservices Limited (TTSL), say news reports. Both the companies are in the process of putting together a two-three-year business plan for achieving growth in the telecom business.
NTT DOCOMO had the option of invoking a ?put option? and selling its 26 per cent stake in TTSL to the Tata Group in 2014. As per industry reports, there was a possibility of NTT DOCOMO pulling out from the JV and the Tata Group looking to bring in a new stakeholder in the company.
However, both the stakeholders have decided to continue with the partnership following TTSL?s encouraging financial performance.
Riding on the back of a restructuring plan, TTSL had registered positive earnings before interest, tax, depreciation and amortisation in the first nine months of 2013-14, while TTSL (Maharashtra) Limited had been cash-positive during this period. The operator has managed to turn around its losses through a mix of initiatives such as cost rationalisation, revenue growth through asset sweating and focus on generating higher revenue. Besides, the Tata Group infused about Rs 25 billion as fresh equity capital on a debt of Rs 260 billion.
